Tough times force massive auction

Iconic company selling millions in heavy equipment, pickup trucks in fight for its life

Workers with Racon Inc. blow hay onto grass seeds at the ampitheater site on Jack Warner Parkway in 2008 in Tuscaloosa. The hay was to protect the seeds and retain moisture so the the seed will germinate. Racon is planning to auction millions in heavy equipment.

Staff file photo | The Tuscaloosa News

By Patrick RupinskiBusiness Editor

Published: Saturday, March 16, 2013 at 8:14 p.m.

Last Modified: Saturday, March 16, 2013 at 8:14 p.m.

TUSCALOOSA | One of the largest auctions of construction equipment in the state's history will be in Tuscaloosa this week, with more than $26 million worth of equipment ranging from pickup trucks to heavy earth-moving equipment going up for bids.

As many as 1,000 people could show up for the two days of bidding, according to the auctioneer, and an untold number of additional bids are expected to be made online.

But the story behind the auction is not a pretty one. It's the story of tough times in the construction industry and in particular hard times for a Tuscaloosa company that once employed about 600 people and was involved in some of the area's largest construction projects over the last several decades.

The equipment is being sold by Racon Inc., a Tuscaloosa company that was established in 1981 and that has done about $1.1 billion worth of construction projects over more than three decades, according to its president, Keith Andrews.

“We are selling our earth-moving assets and getting out of that business,” he said. “But we will be keeping our bridge-building division.”

Racon took a severe hit during the recession and has not recovered, he said, noting the company has not had a profitable year since 2009.

Much of its work over the years involved clearing and leveling land so sites could be developed, Andrews said.

Racon crews help prepared the Mercedes-Benz site in Vance in the 1990s and, before that, the site for the JVC manufacturing plant. It also worked on bridges and highway bypasses in Tuscaloosa, plus projects elsewhere.

But when the recession hit, no one was building new subdivisions or shopping centers, he said. And both state and local governments faced budget shortfalls, which affected funds for highway construction.

What highway work was being done amounted to paving and maintaining existing roads rather than building additional lanes or roads, Andrews said. Racon didn't have paving equipment, so it couldn't bid for the limited work available, he said.

“We went from 600 employees to 80 employees now,” he said. “The hardest part is when the business slowed down and I had to lay off people, some who had more than 20 years with us.”

He said a lot of good workers were laid off and that he tried to help them find jobs with other companies.

Rebuilding Racon to what it once was will be difficult, maybe impossible.

“We got enough work to do through 2013,” Andrews said. “In 2014, we will analyze the situation and decide if we can hang on.”

If there is not enough work, the bridge division likely will be sold off, too, and Racon will go out of business, he said.

The auction, which is open to the public, will be four-day event at the company's plant at 7300 Commerce Drive in Tuscaloosa's Airport Industrial Park. “Everyone is welcomed,” Andrews said.

Most folks might not want a big piece of earth-moving equipment, but “it is a good chance to get a good price on a pickup truck,” he said.

On Monday and Tuesday, potential bidders will be able to examine the approximately 675 pieces of equipment that will be sold. The equipment includes 45 pickups and 300 to 350 pieces of earth-moving equipment that Andrews called the “big, yellow, iron Caterpillar” items, many of which are expected to sell for six figures.

The company's lot will be open for public inspection of equipment from 9 a.m. to 5 p.m. Monday and Tuesday, but Andrews said if employees are there earlier or later, the public will be allowed in.

Potential bidders will be coming from out-of-town. On Monday at 11:30 a.m., Racon's shop will set up to serve barbecue to 200 guests coming to check out items, he said.

On Wednesday and Thursday, the auction will start at 9 a.m. It is expected to continue at least through the afternoon.

Andrews said he expects about 30 to 35 percent of the items will be purchased for overseas use and a like percentage of bids will come via the Internet.

People coming into town for the auction could generate additional business elsewhere.

Denny Wiggins of Alabama Truck & Equipment LLC, which sells heavy earth-moving machinery at 4400 Joe Mallisham Parkway about a mile from the auction site, said he is hosting a pre-auction hospitality party at his business for people coming to the auction.

“The size and magnitude of this auction will bring buyers worldwide to bid on this construction equipment,” he said. ...“I'm expecting to have anywhere from 200-400 buyers stop in to eat, drink and meet and greet.”

He said he hopes to sell some of the $1 million of equipment in his inventory plus $500,000 of construction equipment that Bryant Bank took possession of and assigned to his company to sell.

As for the Racon auction, a list of some of the bigger items being sold is available for viewing at Myron Bowling Auctioneer's website at http://www.myronbowling.com under the upcoming auctions tab.

<p>TUSCALOOSA | One of the largest auctions of construction equipment in the state's history will be in Tuscaloosa this week, with more than $26 million worth of equipment ranging from pickup trucks to heavy earth-moving equipment going up for bids.</p><p>As many as 1,000 people could show up for the two days of bidding, according to the auctioneer, and an untold number of additional bids are expected to be made online.</p><p>But the story behind the auction is not a pretty one. It's the story of tough times in the construction industry and in particular hard times for a Tuscaloosa company that once employed about 600 people and was involved in some of the area's largest construction projects over the last several decades.</p><p>The equipment is being sold by Racon Inc., a Tuscaloosa company that was established in 1981 and that has done about $1.1 billion worth of construction projects over more than three decades, according to its president, Keith Andrews.</p><p>“We are selling our earth-moving assets and getting out of that business,” he said. “But we will be keeping our bridge-building division.”</p><p>Racon took a severe hit during the recession and has not recovered, he said, noting the company has not had a profitable year since 2009.</p><p>Much of its work over the years involved clearing and leveling land so sites could be developed, Andrews said.</p><p> Racon crews help prepared the Mercedes-Benz site in Vance in the 1990s and, before that, the site for the JVC manufacturing plant. It also worked on bridges and highway bypasses in Tuscaloosa, plus projects elsewhere. </p><p>But when the recession hit, no one was building new subdivisions or shopping centers, he said. And both state and local governments faced budget shortfalls, which affected funds for highway construction.</p><p>What highway work was being done amounted to paving and maintaining existing roads rather than building additional lanes or roads, Andrews said. Racon didn't have paving equipment, so it couldn't bid for the limited work available, he said.</p><p>“We went from 600 employees to 80 employees now,” he said. “The hardest part is when the business slowed down and I had to lay off people, some who had more than 20 years with us.”</p><p>He said a lot of good workers were laid off and that he tried to help them find jobs with other companies.</p><p>Rebuilding Racon to what it once was will be difficult, maybe impossible.</p><p>“We got enough work to do through 2013,” Andrews said. “In 2014, we will analyze the situation and decide if we can hang on.”</p><p>If there is not enough work, the bridge division likely will be sold off, too, and Racon will go out of business, he said.</p><p>The auction, which is open to the public, will be four-day event at the company's plant at 7300 Commerce Drive in Tuscaloosa's Airport Industrial Park. “Everyone is welcomed,” Andrews said. </p><p>Most folks might not want a big piece of earth-moving equipment, but “it is a good chance to get a good price on a pickup truck,” he said.</p><p>On Monday and Tuesday, potential bidders will be able to examine the approximately 675 pieces of equipment that will be sold. The equipment includes 45 pickups and 300 to 350 pieces of earth-moving equipment that Andrews called the “big, yellow, iron Caterpillar” items, many of which are expected to sell for six figures.</p><p>The company's lot will be open for public inspection of equipment from 9 a.m. to 5 p.m. Monday and Tuesday, but Andrews said if employees are there earlier or later, the public will be allowed in.</p><p>Potential bidders will be coming from out-of-town. On Monday at 11:30 a.m., Racon's shop will set up to serve barbecue to 200 guests coming to check out items, he said.</p><p>On Wednesday and Thursday, the auction will start at 9 a.m. It is expected to continue at least through the afternoon.</p><p>Andrews said he expects about 30 to 35 percent of the items will be purchased for overseas use and a like percentage of bids will come via the Internet.</p><p>People coming into town for the auction could generate additional business elsewhere.</p><p>Denny Wiggins of Alabama Truck & Equipment LLC, which sells heavy earth-moving machinery at 4400 Joe Mallisham Parkway about a mile from the auction site, said he is hosting a pre-auction hospitality party at his business for people coming to the auction.</p><p>“The size and magnitude of this auction will bring buyers worldwide to bid on this construction equipment,” he said. ...“I'm expecting to have anywhere from 200-400 buyers stop in to eat, drink and meet and greet.”</p><p>He said he hopes to sell some of the $1 million of equipment in his inventory plus $500,000 of construction equipment that Bryant Bank took possession of and assigned to his company to sell.</p><p>As for the Racon auction, a list of some of the bigger items being sold is available for viewing at Myron Bowling Auctioneer's website at http://www.myronbowling.com under the upcoming auctions tab.</p>